The State of Origin of Australian Equity: Does Active Fund Manager Location Matter?

Kingsley Fong, David R. Gallagher, Adrian D. Lee

Research output: Contribution to journalArticlepeer-review

4 Citations (Scopus)

Abstract

We examine the relation of active equity fund managers’ location proximity to a stock's headquarter and fund managers’ stock selection skill and investment behaviour using a representative sample of Australian institutional equity funds. Contrary to the findings of much international research, our study reveals evidence which is inconsistent with a location advantage for Melbourne and Sydney active equity funds. Both Melbourne and Sydney fund managers overweight Melbourne stocks, exhibit skill in picking Sydney stocks and avoid poor performing Melbourne and Sydney stocks. In addition, we find no evidence of word-of-mouth trading effects in Melbourne or Sydney funds. Taken together, this suggests information asymmetries arising from location are weak for Melbourne and Sydney funds.

Original languageEnglish
Pages (from-to)503-523
Number of pages21
JournalAustralian Journal of Management
Volume32
Issue number3
DOIs
Publication statusPublished - 2008
Externally publishedYes

Fingerprint

Dive into the research topics of 'The State of Origin of Australian Equity: Does Active Fund Manager Location Matter?'. Together they form a unique fingerprint.

Cite this